ML19329D212

Transcript of 760405 Hearing in Silver Spring,Md. Pp 8069-8135

ML19329D212
Person / Time
Site:	Davis Besse, Perry
Issue date:	04/05/1976
From:	Rigler D Atomic Safety and Licensing Board Panel
To:
References
NUDOCS 8002260785
Download: ML19329D212 (66)

Text

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Regulatory Docket Ele, NUCLEAR REGULATORY COMMISSION

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IN THE MATTER OF:

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TOL1:DO 1;DISO.1 CO!!PMY and f4/7T.6 CIIVI: IRID ELECTRIC ILLU!!IllNrIsIG CO.

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CLl;VT.LMD ELECTRIC ILLUI;I:iATIWG nM,

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s (Perry iluclear Power Plant, Units

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Itonday, April 5,1976 00G9-8135 THIS DOCUMENT CONTAINS POOR QUALITY PAGES Telephone:

i (Code 202) 547-6222 l

ACE - FEDEllAL llEPOft

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Official Reporters 8002260.

415 Second Stroet, N.E.

1 Woshington, D. C. 20002 NATIONWIDE COVERAGE

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CHAIt1A3 2!cL22:

I thin!: r2 wi?.'. aus.rt cut n

this morning: uith your coracats ca ch-2 Appi:.can 3a 105 Motica, 1

4 Mr. Goldberg.

O MR. GOLOSE20:

The ICC Sun 2f would 1:.::o to ach ':he O

Board'c patience uhile it discucces a number of things which 7

we believo are impcrtant for the 30 erd 'c consideration in i

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ruling on the Applicants Rulo 105 Motion.

9 The Administrativo Procccurc Ach in tha 10 Commiscion's Rules of Practica, ac wall as ccAc law dren 11 the Supreme Court on down makas it clear that ima ctric':

i 12 rules of evidenco do not apply to Administrati te Preceaings.

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13 consequently, Rule 105 should net ha 14 accorded the came weight, nor cpplied uith the are.c at'rictly 15 as would bc done in the federal courta.

16 Rule 105 and the Advicory Cc:caintaa acnac on 10F, I

17 make it clear that the main purpcse of the Rule ic sith 1

13 i respect to trials heard by a jury.

The concern ic uith n yczy 19 misusing evidence which has been intreduced into the record, i

20 We surely recogni=c that this Bonrd site an a 21 trier

- as a finder of fact.

Sut chia 3 card is elecrly nore 22 capable of properly using the evidence than wculd ha a jury without very explicit instructions, 23 f

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24 The Staff would like to make clear to Applicants 25 once again that we are not in court attempting to prove 4

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3072 mm2-I that Applicants have violated Section 1 cr Sectica 2 of the Sherman Act.

We are not conducting a criminal proceeding 3

of any type hero, rcthar we are bafers s Federal.;dministrativo; 4

Igency conducting a pralicensing antitrust review ann S

attempting te prove only that Applicants achi.vities ander 6

the license will creata or maintain a situation inconsistent 7

with the antitrust laws or the policies underlying those 1cus.

O as we noted many times beforc, for e::amplc in ou trial 9

briefs, and as we note once again now.

10 The Staff need not prove a violation of anyching, 11 enly an inconsistency with the antitrust Icus and the policies '

i 12 underlined in those laws.

The legislative hictorv nahes it I

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13 clear that Congress considered both violations and I

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14 inconsistencies as the scandard, and specifically chose a l

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15 standard of inconsistency.

1G The Atomic Energy Act in its legisintive hictory 17

. explicitly states that the Federal Trade Commission Act i

10 is one of the antitrust laws for purposes of the Atcmic Energy 19 Act.

It necessarily follows that Section 5 of the FCC Act 20 and the policy underlying Sections, sets a proper standard I

21

. of conduct against which Applicants conduct and posicicn in 22-the market should be measured.

23 1 The same standard of reasonable prchability 24

_raquired under Section 7 of the Clayton Act sh cald be i

2f applied to determine whether the activities-ander the license i-1

0073 mm3 would create or maintain the situation inconsistent with the antitrust laws.

3 3

The Staff stated and discuscad this position 4

thoroughly in its trial brief dated Nover.u:cr 10, 1975.

We ad s

App and once Wein todcy dat va -- of cw 5

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p sition, and we will tato our position once again in our 6

proposed findings of facts and conclusions of law in post-7

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6 As the Staff noted in its December 3, 1975 answer D

of the NRC Staff to Applicants' statement of procedural g

raatters to be considered, the Staff has not charged Applicants with a conspiracy.

Neither has the Board so characterized cny of 1 s, Staff's allegations, m

,s CIIAIPl4AN.R.TGLER :

W have approved the. conspiracy g

Perhaps you haven't charged it, but perhaps you proved mor2-16 7

than you charged.

MR. GOLDBERG:

That is a possibility and our posi-tion is that the Board shculd.be in a position to make all i

reasonable inferences from the evidence which has been 20 introduced.

As I will discuss shortly, this necessarily requires denying Applicants' rule and applied motica.

MR. SMIT 11:

What is your answer to the Chairman's 23 gaestion?

24 MR. GOLDBERG:

The Staff haa maintained and has 1

1 3074 mm4 proven that.there has been joint action by the Applicants.

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2-We have introduced avidence

?. ainst CA?c; an a. cole, :a have shown, have allaged.and shmin thni Applicanu :.ndividually I

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4l and as a gro.tp dcmint ca ::he ral w-

- mar *cana, th*.':.'.pplicanus i

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3 individually and as a group hrra contrcil_d accesc sc 4

,3 essential resources c:.d have'donied cccacc to thos3 nesentici 1

rescurces.

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cgninst cach Applicant individually, cgcinst ths Applicante e

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as a crouc, their policiar, their activitien. their pc.3ition 10 in the market, their dominanca and chusa thereof.

I.s IIR. SMII'H:

The ansuer then is no?

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I ihink that w: should not bo in 13 c pcsition to eliminate that consibility bv moral" statino.

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.o CEAIPJiAN RIGLER:

Hell what bettor tina than at the end of your completo cEne?

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i MR. GOLDBERG :

I think that th3 evidenca can be --

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that there is an inference of conspiracy ch:t one could 3

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draw from the evidence, and I think the Socrd in entitled to 4

21 do that if it so chooses.

That has.not been the main focus of our case,

,3 Eowever, I don'.t'think it would be improper to I..ake n finding of such, t.

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,nia r:ua5 MR. S!!ITH:

WOuld you urga that dinding upon ns?

It We are not going ' o 1ai ycu e.v;id this.

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nn. GOL0cERG:

W3 vould char.tc1.ri.v. th.m easa ca

.a one of joint actica, or actica in concert as opposed to a specific agracment which constitutsa conspiracy.

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As the case law chown. and as I uill discusa i

6 shortly, an agreement, a cpacific agreement need not ha 4

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proven in order to establian a conspiracy.

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CIIAIRMAN RIGLE2: '7e understand tha t.

That is not 9

3 the basic question.

j 10 MR. SMITil:

Uc are able to distinguich between what 11 I i

you are required to prove and uhat you clain you hrve proved 12

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'. and.they are not necessarily equal.

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$1. GOLDBERG:

The direct ansucr then to your 11 questien is no, we have not proven what has tr ditionally 15

.-l been called a conspiracy with the traditional dafinitica ol -

IO getting together and agreeing and conspiring t.c 5.c c-craething 17.I j

illegal.

18 We have not alleged conspiracy.

19 o

CliAIRMAN RIGLEn:

We understand you htvcn't i.

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alleged it. Ue have been around that track twice now.

21 hir Smith's question and my que. tion wac, have e

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a you proved more than you hava allaged.

If ih cakes a

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.you are putting more than enough evidence so that we ccn justify a

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A.n.glicants once again what ua have ctated numero>.s ti22s I

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MR. GM.DBEEG:

It.tplicanto hava iointl. cp.olied for i

licenses to conar uct and or:rato the Davis'.32sce nuclear o9

-i pdune clants.

This alonc r.ah.ts Acplicanta ns a groco the 23

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._g it natural -:... Z to enemino-fcr-che purpocas of determining 24 i

whether or not the cativitics un6.:r the liconse Would creata

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or maintain a situaticn inconsistent with the an iitrust laus.

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"he Staff case is directed at the issues in l

3; natters in controversy which were cet forth by the Eccrd in 4 i Prahecring Conf arsnco Order No. 2 on July 25th, 1974.

5 Broad issue A concerns the structure of the 6

relevant market or mar :ets and Applicants ' abili'qy --

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" Acting individually together, or together a

with others - "

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-- to hinder or prevent others frca certain achievements.

10 Broad issue n statau:

t; "If the answer to broad issua A is yes, has 12 Applicants' ability been used, is it being used, or 15 might it ba used to create or maintain a situation

4 inconsistant with the antitrust laws or the policios

-l 15 underlying thoso laus."

1G The Mattes in C7ntroversy all relate to issues 17 and B and thus all relate te Applicants as a group as A

33 well as individucl.

39 Matter in Controversy No. 10 conecrns Applicants 20 policies with respect to access to nuclear facilities, uith 21 respect to theis granting access tc those nuclear facilitics

,3 to othars.

c 3

Thus this group of applicants is the natural

',11LU) g enemy against which all of the evidenco in this procceding

.5 should be considered relevant.

L

i 3070 mms The Board's

lemorandma and Order with r2spect to Applicants' requeat for cartain procedural rulings fully i

1 l supports this position. For enanple, on page 7 of the i

,a 1I Ecard's Order, dia Board ctatcd:

4 "Here we have both an allegation that the

,o CAPCO agroanont as fashionad and implocanted constituted an e::precs agreement in reutraint of trade coupled with an assertion that Applicants

,v parallel cocrses of action with rsspect to 9

refusals to wheol or to permit coordinated oparution or dcVelopment except with each other, resulted in 11 restraint of trade in combinations to acnopolina 12 within the CAPCO area."

13 The Board further-stated on page 9 of its crdor:

l "The issues in controvercy sot forth co 15 early in this procccding clearly contemplate

~

16 situations inconsistent with the antitruct laws 17 resulting from monopolication in combinaticas of 18 conspiraciec to monopolize in the relevant aarhet 19' is postulated to be the ccmbined CCCT territories."

20 CHAIPl!?d RIGLER:

Yec, we know what we said.

21 The question is, at tha time wo wrota that we.

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e were repeating our understanding of the allegaticns made.

.23 What uo wanted to ask today is, what evidence 24 capports those allegations?

ES

CD79

"'1 MR. GOLDBERG:

I will discuss tha evidenco which 1

2!

uupports those allegations ncu, if you wish me to do it I

3 right ncw.

1 4

CHAIPMili RIGLER:

Yes, pleasa.

5 MR. GOLDBERG:

I thini, hcWever, that the past 6

uling of the Beard should be %cpt in mind when ruling on 7

dis motion.

C CHAIPJiAN RIGLER: We hava 4 '- in mind, Mr.Goldberg.

9 That in why we unnt now to relate the evidence to the 10 allegations.

11 MR. GOLDBERG:

I Uculd liko then to diccu0s a 12 few examples of things that the evidence, ue believe, hac 13 proven in this proceeding, and I would like to discuss these 14 not by way of limitation at all, but only as examplec.

15 The Bocrd, now that all the evidence of thr-IS Staff, the Department of Justico and the City of Cleveland 17 is in, chould be able to drau reasonable inferenccc frca thin 13 ovidence.

19 For example, this proccoding concerns applications 20 for five major nuclear f acilities constituting appro::imately 21 5000 megawatts for nuclear baseload capacity.

22 TheBoard can now take notice of the fact that 23 there are no participants in those unuclear unita other

- 24 than the CAPCO members.

2.5 This is clearly inconsistent with the policy of

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I 8080 mml0 the United States and the purposa of the Atcaic Energy Act as set forth in Sections 1-B and 3-D of the Act.

2 The Board new kncus that Painesvilla, Pitcairn, ea i

4

' Cleveland and. the tiholesala Censumers of Chic Edison requcsted i access to these facilities, and vere in offect denied accces.

What dcas that tell us abent the Applicantn'

,j policies as a. group with respect to non-CAPCO participation in s

gi those nuclear units.

It is the Staff 's position that the. roerd cust O

permit itself to be in a position to drau reasonable inferences g

E frsa the ovidence and should not tie its own hands in such a

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way es to cmit the inferencer which the acard can draw from 12

' -the ovidence..

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j As another enample, and again not by uty of

,_ i limitation, but only as an example, the evidence in the raccrd wl 1

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clearly establishes that CEI has refused to whosl for

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Cleveland; that Toledo Edison has refused to wheel for Eculing Green; that Ohio Edison was reluctant to interconnect t o, with Orrville; and Ohio Edison refused to uhuel for Crrville; t.,w that Ohio Edison has refused to discuss wheeling; and Ohio g

Edison has. in effect refused to wheel to each of the Wholasale j

21 Consumers of Ohio Edison; that Ohio Edison diracted tho Wholesale Consumers of Ohio Edison to dehta the subject of wheeling from the clements of a study of alternative sources of bulk power supply.

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What reasonabla infences can be draun frca this 2

ovidenco?

3 CHAI?J1Ali RIGLER:

W Pt conclusions should Ue l

4 draw frcm that evidenc27 5l MR. GOLDBERG:

You should conclude that this is 6

t.ae policy of CAPCO as a group.

CHAIRMAN RIGLER:

What is the policy of CAPCO g

a:3 a group?

g MR. GOLDBERG:

Rafusals to wheal as this e:: ample 10 relates.

g Similarly, with respect to access to nuclear in 12 "Y Pfi*f ***"Pl**

13 CHAIRMAN RIGLER:

You are saying that the evidenca g

establishes a collective refusal to wheel, which is c::crcised byindividualCAPCOme$berspursuanttocomojointpri'cr 15 16 undarstanding?

ZiR. GOLDBERG:

Yes.

7 5

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18 gg contacted by separato letter, cach of the five CAPCO ccmpany 20 presidents,and requested membership in CAPCO.

Each ecmpany denied the request in nearly 21 icentical language and jointly arrived at a consensus, 3

g Once again the Board should be able to draw a reasonable inferences frem this evidance about tha policies of CAPCO as

.a group.

3082 mm12 1

CHAIF3IAN RIGLER: Well the Scard enn d:pt inferancea.

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2 from the evidence.

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The question is what cenclusions does the Staff i

4 urge us o drau frem v.he evidence.

5' MR. GOLDB2RG:

Thic e.vidence este.blishes

2. clear 6

group boycott.

And thena e::amples, I think, requira the 7

3 card to deny Applicants ' Rule 105 Motion no that it cau 8

draw those reasonable inferencos from this evidence.

9 Now, I think there is como relevant Supreme i

10 Court Case Law --

11 CHAIFJ1AU RIGLER:

Mall let'n koop going with the I

12 examples, first.

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13 MR. GOLDEERG:

Well thoso are the only three i

4 14 examples I intended to point out nov, 15 I could give another er.:mple of the reserve ---

16 the policies with respect to reserve rcquircmentc.

I think 17 the evidence shows that that reserve formula of Chu00 in

3 inherently discriminatory against small systems.

And it 1D was specifically designed that way.

20 CHAIRMAN RIGL2R:

All right.

Now when did Applicanta conceive or put into 21 22 offect these joint policies?

23 MR. GOLDEERG:

Docausa of my discussion so far and the few Supreme Court Cases I would like to briefly a.,

discuss, I don't believe it ic necessary for us to specify c 25

8003 date.

I think the law makes it clear that we canno:

mm13 specify -- cannot always cpecify a dato as to when oven a conspiracy began.

Che lau dcasn't require it and I don't f

i think we should have to ha put in a position now to specify 5

If you do vant us to r'pecify a date, however, G

sven though we don't believe it is necescary for the purpose 7

of ruling on the 105 Motion becauso we think it should be g

isnied in its entirety, I would say only that the CISCO as a group, as of the dato it was planned and as of the date it began operating, including its impicaen intion of the e

discriminatory reserve formula and other CAPCO policies, clearly constitutes a situation inconsistent with the 13 I

f antit-ust laws or the policies underlying these laws.

I CHAIT4G.N RIGLER:

In that because it was a 15 policy of CAPCO right frem the formation to deny wheeling 16 o,

and to deny membership in CAPCO to smaller encities in the 17 area?

I MR. GOLDBERG:

I think that frc.nthe very i

19 I

beginning it was structured that uay and that is the furthest i

10 date back we believe that these activities began or that ua 21 would care to allege that theca acti.'itics began.

21 It was from that point on that Applicants' 23 activities have to ba 1 coked at very carefully.

And uhen 24 all the evidence is in against the Applicants is in as it is 25

8034 mml4 1

now, I think the conclusion is clear.

CHAIRMAN RIGLER:

Enat arc we 'to do with the o

allegations relating to prico-fixing by CEI back in 1962 in (1

connection with working cut soms arrangement uith HELP 2 5

MR. GOLDBERG: Wellthat is not eno cf our allogations, 6

and I am not saying that this is all-inclusive for all parties i

1 in this proceeding.

For tha purpose of Staff's case it 8

goes back that far.

9 Now this Board has set Ss.ptember 1st, 1905, I 10 believe, as a cutoff data.

In ordcr to be consistent 11 with that we would, if we had to specify a date, simply then say September 1st, 1965. From that date on the Ovidenco 13 is clear as to CAPCO as a group.

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I would like to very briefly point out a fzu 15 Supreme Court cases which I think requirca denying ?.pplicants' 16 motion in this proceeding.

O In Interstata circuit, Inc. v U.S. 306 US203,

'O page 227, 1939 case, the Supreme Court said, and I quotc:

IO "It is elementary that an. unlawful 20 conspiracy may be and often is formed without 21 simultaneous action or agreement on die part of 22 conspirators."

1 23 In United States v Masonite Corpor. tion --

24 CHAIR!4AN RIGLER:

Wait a minute.

4 G O.u.a w i

25 That in h ing troublo with your earlier position.

3

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=-

3085 mm15 1

Did CAFCO, applying the Rule cf Interstate Circuit.

2 contribute -- find that C'GCO conspiccd to climinate smaller 3

systems by denying then accccc to bulk powa suppliec?

MR. GOLDBERG:

Well, the point unc -- I thinh 3

the point to be considered with respect to Interstate Circuit, c

is that even where we had a conspiracy, and ac I have answarad 7

your questions before, uo don't have a conspiracy case -

a even when you have a connpiracy it is not necessary to sit g

down and prove exactly when the contr:ct or when the 10 conspiracy bogan.

That you don't need simultaucouc action, 11 that it is a lot more complicated then that.

It is just not 12 as simple as saying what date did we conspire.

th Apd that is the point, I think, to be drawn from y

that.dVen when you have a conspiracy case.

15 In United States 3 Maccuite Corporation, 21G jg US265 pages 274 to 275, 1942 cace, the Court caid -- the 7

Supreme Court said:

zg "But for Masonita's patents and the del

g credere agency agreenonts there can be no doubt that gg this is a price-fining cc=bination which is illegal 21 per se under the Sherman Act.'

g That is true, thoug the District Court found 23 that in negotiating and entering into the first 24 agreements each appellee, other than Masonite acted 2a_

independently of the othorn, negotiated only with

G086 mm16; Masonite, desired the agracmant regardless of the 2

action that might be taken by c.ny of the others, did 3

not require as a condition of its acceptance that 4

Masonite taake such an agreement with any of the 5

others and had no discussion s with any of tho G

others.

It is not clear at what precise point of time 7

each appellee became aware of the fact that its 8

contract was not an isolated transaction, but part of a larger transaction."

9 10 In American Tobacco Company N the United States, 328 US781 at pages 809-10, 1946, the Supreme Court said:

3; 12 No formal agreement is necessary to c nstitute an unlawful conspiracy...The essential 13 co.~bination or conspiracy in violation of the Sherman 8*#

A t may be found in a course of dealings or other 15 cir umstances as well as in any exchange of words.'

~

16 4

CHAIRMAN RIGL3R:

And what we have been asking you t/

to do all morning is identify the course of dealings, g

MR. GOLDBERG:

I have given several examples of g

that.

,0 c

CF. AIRMAN RIGLER:

All right.

MR. GOLDBERG:

Theatre Entarprices, Inc. v Paramount Film Distributor Corporation, 346 US537,540 to 541,1954.

,,ca The Suprama Court said:

" Business behavior is admissible circumstantial 25 l

f 8037 mm17 1

evidence frem which the factfinder may infor agreement."

f 2

Eased on what I have stated here today and baced 3

on the Suprame Court Lt.u, I think the Applicante ' Rulo 105 4

motion should be deniod in its entirety and chat Staff chould 5

act have to specify a date or further specify uhich ccmpanies G

our evidence is introducad against.

7 CHAIPRM RIGI2n:

Justico?

G MR. CHARNO:

At the outcot, the Department would 9

like to adopt certain of the Staff's positions to save to time.

11 First that Rule 105 is a jury rule, we agrac fully 12 uith that.

I

.I 13 Further their argument concerning the standards k

inconsistency under 105 C were ccmpletely/ in accord with g3 our position.

l

g te vnuld like to adopt their Sttmnary Statements j7 of Evidence and their citations of caso law concerning the i

I

g requirement for specificity with respect to the data of

(

79 inception of a conspiracy.

CHAIRIUO! RIG!aR:

h' hat was that?

go 21 Don't adopt it. Tell me what Justice's position

.a.

is with respect to it.

MR. CHARMO:

Thahthe Department is not required 23 g

to prove the exact data of inception of tha concpiracy, vould be the Department's position.

..a

8080 mm13 CHAIRMTd! RIGLER:

2.11 right.

3 2

Let us assume that tha.t is corr 2ct.

3 iihat vould be the data, the earliast dato at

_3 uhich the Department contends. the racerd fina'.ly demonstratas e

e unlawful --

r-a g

MR. CHARNO:

I will attempt to set forth thu 7

Department's position on each of the conspiracica.

3 The D2parbnent is in a position, va believe, of g

having proved more than we initially allaged in cur Scptember 5, filing.

g Examination of the record indicates that the 2

degree and extent of joint action was more comprehensive an we n

a y

e eve a

ne -

e we c

ep adh.g 13 on September 5.

1~,

f We would note first -- as:t the Board to concludo

.o s

that the evidence demonstrates that the members of CAPCO to entered into a conspiracy to eliminato competition by denying

,u

.O the benefits of coordinated operation and edevelopment to i

e i

5 other entities located within the CCCT.

0 U8 n we can MenC_/ such 20 a conspiracy appears in DJ-568, pages 26 through 28, uhere

,41 Er. Lindseth, former Chief Exocutive of Cleveland Electric Illuminating Company, stated that during the negotiation of the CAPCO agreement there was discussion of the enclusion

<.a cf municipal systems from the then contempleted CAPCO agreement,

0099 mm19 i

and that this took place sematino prior to 1967 when he. loft t

2 Cleveland Electric Illuminating Company.

3 We are unable to cupply the beginning dato of 4

the conspiracy with grantor specificity than that.

f 5

The nent document, or the first docunent of which s

we are cuare, which makes referonce to the conspiracy uns 7

one dated in February of '67 which was Enhibit C-25 which was S

rejected by the Board.

9 We would take enception: since we were not the 10 introducing party, to that rejection.

CHAIRMAN RIGLER:

What was thn document?

12 MR. CHARMO: That was c do cument which indicated 13 that municipalities might challenge an application to construct !

l

,;,800-megawatt generating unitc,, and I believe it was encluded J-

3.I wasn't here at the time -- on the bacio of the fact that that IG that referred to an application prior to the time the 105-C 5E g

its present time uns passed.

3 I would feel it would be immatarial whether 105-C

9 cnisted with respect to the proscace of c conspiracy or the 20 desire to exclude municipals fran the conspiracy.

21 We believe that there is evidence prior to the 22 execution of the CAPCO agreement; sp0cifically dccuments 346, I

i 23 DJ-278, C-48, DJ-279 which indicato that the agreement, g

Memorandum of Understanding, was designed as a stop in the affectuation of conspiracy to elininnto ec= petition by donying 25 i

3090

I henafits of coordinated operation.

2[

We ara facad uith the situation uhero the samo 3

conduct is violativo of a numb 2r of provisions of the antitrust 4

!.aws.

Wo believe it dess constituta conspirccy sin violation 5

of Section 1.

It also constitutos an agreement and a i

~

6 combination in violation of Secticn 1.

y CHAIRMAN RIGLER:

When you say an agreezent, are g

you referring to the CAPCO agrescent, or ara you referring p

to an agreement in the general courca of decling and 10 understanding from CAPCO?

1; MR. CHARNO:

Specifically to the CAPCC 32 e.greement.

13 It further constitutes bottlenock moncpoli=ation 14 by the members of CAPCO and a concerted refusal to deal in 15 violation of Section 1.

So that the condtet that has been 16 proven, while it definitely supports the allegations 37 initially made by the Dopartment in our Septenbcr 5 filing,

g also supports charges of violation of other provisions of gg the antitrust clause.

_.0

. CHAIRMAN RIGLER:

I notice you mantion Section 1.

Do you make any contentiens with respect to 2

7 22 E*C_ tion 2~ and any combinations to monopolize.

MR. CHARNO:

The bottleneck monopoli:ation which 23 24 the Department charges would be a shared monopoly as hottleneck monocolizations often arc.

2a.

l

--w r

g

-w

--s

cL a.,.,.

mm21 The Department wculd furthtr c.c.:

.he Ocard to

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,j violative of Saccion 1 of zhs Sherman T.cc, ura Elec :. coa:spirac.7 i

i a[ in violatica of Section 1 c'

^

Shor".an Act.

And we 1

n

vould n::gua on tho.ocate cn w.,., e-, c.: Do-a:., canc5 4. u.,

a. no.

t 41, that this conspiracy w.n :Iirm;. acndalvce --- pcrden me, 7

was first conceived in 1962 av:2 --

CIIAIIGAN EIJLER:

~Ti:ich cd che C.'JC0 ccmpcnios g

woro parties to the Buche.ye agrae?. ant?

g MR. CHARXO: This would ha Ghio -- Euchevs acreemcntr:

11 would bs Chio Edison and Tolado Odicon.

I CHAIRkhM R.IGLER:

And you nra contending that not l,a, cnly is there a conspiracy between zhore comp ni m and

,m i

Euc! cave, but batucen cach othar an to.l?

A hcriconbal 3

-=

io t

i 1,

censo.iracv. amons. CAPCC msnbers?

.u MR. CEARNO:

That 10 correct.

I G

I

(

Further evidencs arain relatine. to th3 20rms.ticn cd the conspiracy uas contained in DJ ?GO and 4CO, uhich 19 were rejected by tha Board.

,,_G i

MR. REYliCLDS:

Mnv I interrupt just to get the n

i answer to.vour c."aestion chott horincntal acnspirac.v?

g,

?

Could yoc just give it to ma agcin?

I am not sure I cauciht what the answer una.

w, c.

CHAIRMAN RIGLER:

My qucE:icn was:

Do you charga

'~S 1

4 1

i i

8092 7

with respect to the Buckeye agreement a horicontal concpiracy 2

among C3.PCO_ ms abers, and you answared --

l vamk 3

El.CILLT!O:

Yc:c, with reapect to de two ain'.n 4

CAPCO members.

5 Ih addition to the conduct which ic dirocbly

~

6 susceptible to categorization as a concpiracy, the Department 7

is clso alleging that cach of time C.WC0 ccmpanics individually i

e has engaged in conduct inconsistent with the antitrust laws I

g including bottlenock monopolication within their territories i

I

'. of tha Sherman.ict 10 and a number of violations of Section

3 and the Federal Trade Octm

ission Act.

12 CHAI1bfAU RIGLER: Well are you charging that 13 in addition thero they combined to strengthen tha individucl i

g monopolies within each of their territorics?

MR.CHARNO:

res, sir.

l a-16 The joint monopoli ation, the joint cource of conduct which is capable or susceptible chracterization in g

t

e. number of different ways, the concerted action in which

{

g gg the Applicants engaged, had tha effect of porpetuating their individual monopolies.

And cince the purpose of that joint i

40 I

cetion was the suppressicn of ccmpetition, it is identical t

c.1 I

with the purpose of their individual course of conduct 22 prior to entering into joint action.

g The joint action simply entends over a wider 3

area those policies and tractices uhich had been maintained 25

8093 mm23 1

within the individual CAPCO company servica arca prior to

)

2 intiation of joint ac'. ion.

3 So basienlly the Deparir.ent uculd ask cn the 4

basis of the record at this point, that the Doard draw the 5

conclusion that there is conspiracy in r.hs two instances G

that I have just outlined in argument.

7 CHAIRMAN RIGLER:

And in addition to conspiracy 8

you have also charged combinations in restraint cf trade 9

agreements, and restraint of trade concerted rafu3tls to 10 d.eal?

11 MR. CEMNO:

Monopoli::ation bottleneck, 12 monopolization violations of the I'cderal Trado Cor.iscion 13 Act.

14 CHAIR:iAN RIGLER:

A:id you relate those hach to 15 the formation of the CAPCO group as the formation pstiod.

16 MR. CHARNO:

Well to the period prior to the 17 execution of agreement.

I am not sure what fornation I

18 means.

If it means the execution of agreenent, no we. c.ra 19 before that.

l 20 CHAIRMAN RIGLER:

A minute ago I asked i

21 Kr. Goldberg how the parties were asking the Board to treat 22 the allegations with respect to prica-firing by CEI in 23 its dealings with MELP 1961 and 1962.

24 MR. CHARNO:

We would argue that that..'as an 25 attempt to establish a violation -- an agreement violative t,

h 1

8094 t

of Section 1 of the Shenian Act and that it was a practice 2

.in support and furthering cf no.opolieation in both the 3

uholesale and retail markats as tre hcva definad than in this 4

proceeding.

i 5

MR. SMITII:

Do the CMCC arrangementa anhanca l

Cleveland's capacity to engaga in that type of activity within e,

7 its own service a ea?

8 MR. CH.WiO :

Sir, when you cay Cleveland, do you g

mean Cleveland Electric Illuminating Ocmpany?

10 MR. SMITH:

CEI, yas.

11 MR. CH.~UtNO:

Clearly so.

[

a2 They add to and enhance monopoly power and 13 they constitute a misuse and abuse of :tonopoly power, t4 MR. SMITH:

I may have been inattentive, Did you IS discussed the role of the allegations of territorial allocaticir.s 1

this morning?

l to 17 MR. CHARNO:

No, I have not.

g We would not constitute -- we would not

-- the 19 territorial allocation agreements are, on their facc, violations i

20 E Section 1 of the Sherman Reb.

Again they are in furtherance t

and in support of monopoly pcuer in the retail and wholcuala g

markets with respect to each of the Applicants who engaged in c3 such agreements.

3 They are also a device which can-he

utilised to effectuate the monopolization that takaa place in the CCCT ca

)

i

3095 m25 1

with respect to all of 'd.e moahers o"

"? n'O.

I 2

MR. SM 5~ :

!?culd you repean that,. please?

I 3

'Wh e = u~e.~., '.v.

.w 4.*.'- _

d

.#... w-.. _- k.e.. n. ~..- u r.'.

}'

.e m.

4 as requested.)

5 9

7 8

Q 10 11 12 13 14 15 1C 17 1 ',d 19 20 21 22 23 24 25 1..

i

8096 EAK t

MR. SMITH:

So thera is a ne::us betwor:n C~ PCC

. Start 1 als !!M 2y airangnment and tha territorial allocations 3

f tR. CHAPlIO:

Cao Capart.mnt would 2.t tha cutsce that 4

4hoso territorial allocction agrcanenta coincide 5

chronolcgically witit the haginning of coordinated opar? tion g

and development among the CAPCO ns:nhers.

i We would further not0 that as Dr. 'Uoin pointed 7

g out, coordination on the scale amployed by the CA?CO g

members is often acccmpr.nicd by the slimination.of

.3 competition between the coordinating partiec.

Clearly,the cgreementa are wholly concistann with, and supportive of, a conspirccy to eliminats competition l

12 by denying the benefits of coordinated cparation and 13 develoinent to entities within the CCCT.

4 s

CHAIRMA!i RIGLER:

City of Cleveland.

, b.

s MR. HJEL!EELT:

I would like to ioin in adopting -

T o-the Staff's' discussion of the role of Rul3 105, the standre.rd l_e of-inconsistencv and their summarv cf the evidenca and their 4

13 discussion of the case law with regard to the cpecificinv 19 of the date of the inception of the conaniraev.

20 I would also largelv adopt Mr. Char:.o's discussion 21 ofthe CAPCO as a conspiqacy and agree with his suggsstien g

that the date of incaption was at least in the early 23 discussions as described by Mr. Lindcoth.

I would without attempting to make an exhau.stiva reference to e:dlibits,,

a

8097 bw2 add reference:s to NRC-12 HEC-53 and 54,

[

CHAIPyJ.N RIGIlda:

.-ihat ara they?

~

e end 1 4

e w

4 9

10 l$

2 13 14 15 1G 17 18 19 20 21 22 23 24

.s.,=a 1

EAX 3098

1. 2 1

MR. E7ELMFELT:

NRC 12, I believa, is tha Duquesne r1 2

.etcer to Mr. McCaba, 9;hich Ocncains & parantnetical phrase 3

on the bottom that that reply represents a consensus of the 4

4 c.tcorneys for the CAPCO ccmpanica.

5 MRC 53 and 54 are a letter frca Las Henry to Mr.

g Davia, ravicuing a draft of URO 6, which *ran another 7

responce to Mr.

!!cCabe, and sayit that the draft was a

contrary to the consensus of the CAPCO IcWyern at the last meet 9

ing.

10 Alco I refar to City Enhibit 47 49, 51, 32, and 54.

11 12 CHAIRM73 RIGLER:

What is the subject matter of those exhibits?

a t o, MR. HJELMPELT:

47 is & May 16, 1967 nemo by Mr.

g4 Cempler regarding the effects of adding c cmall cystem to 15 CAPCO.

80 C-49 is an Auguct 24, 1957 document expressing 37 concern thct municipals would try to join the CAPCO pool.

g C-51 is a September 11, 1967 document which again gg expr sses the belief that municipalitios chould not be in 20 CAPCC.

~

41 C-52 is an October 22, 1957 document in which there is a discussion of how the CAPCO companies are going to g

explain to the Federal Power Commission the exclucien of municipalities, public power groups from CAPCO.

0099 ar2 i

C-54 is a Novc=ber 1, 1957 document of Ohic 2

Edison discuscing uays to incroaco the burdon en a 3

municipality if it ahould becora a member of CAPCO cad 4

thus placa disincentivas on joining CAPCC.

5 I believe that is tha issua that the Dcard unc 6

interested in hearing from parties on.

7 CIIAIRMAN RIGLER; Hava you established the allsgetienu G

in your Septonbar 5 filing?

9 MR. HJEL2 GELT:

I balievo uo hava.

10 CHAIRMAN RIGLER:

IIave yod Octablishod more than f

g; those allagetionc or have you established what you have ta allegod?

I think I have certaiftly established

(

13 MR. *!JELMFELT:

,4 what I hav

.ged.

That is that there wac c concpirney to 15 preclude municipalities from obtaining access to bulk pc'.icr g

supplies, conspiracy to exclude municipalities from CAPCC and from obtaining accase to economicc of scalo and 37 coordinated oporations and devslopasnt as well as bottle-33 neck monopoli:ation of generation and trancmiesion.

g I think I have alco, although I don't think in 0

this discussion,probably proved tne allegationn with 21 respect to the act3 that cro mora directly relevant to CEI

""0 Y'

23 CHAIR:iAM RIC-LSR:

IIow do you contend we chould look g

at the alleged price-fixing which CCI urged upon the City in no,_s i

f 11 i

3100 t

1961 and 1962?

That is in terms of joint action or its 2

relation to any overall CAPCO action.

3 MR. HJ2LHFELT:

With roupact to 1?G3 and 19G3, 4

the earliar rafusals precada the evid:nca which shouc tha i

r3 CAPCO conspiracy.

And therefora era acts of monopolization g

and attempt to engage in prica-fi::ing by CEI aloac.

7 HR. SMITH:

You cae no relationship?

g MR. HJELMF2LT:

Wall, I cae a relationchip in that g

this was the sarac sert cf activitica going on eluowharc in that 10 the idea that the Toledo Edison vanted -- had at 1cace an inforcal policy, desire to acquire municipalities.

acquacna 33 Light was doing the came, acquiring all municipalitier

(

t o-in an attempt to monopolica.

4 I don't think that they had gotten together and discussed it together, at least on the record.

1a-CHAIR 3GR RIGLER:

I thought you told us thcb 1G wasn't nececcary.

I thought you atartaa cue by adopting 7

"#9 " #

0""

13 wasn't necessary for the companies to got 'ogocher and c

79 discuss these common objectivec.

to MR. HJELMFELT:

I agroc uith that.

g I think there may need to ho more than just 22 the fact that each of hem vere doing it.

I think inter on they got together and had a community of intaract in

,4 doing it.

i 8101 4

ar4 e

i 1

That Mac the effect of the Ch.PCO conspiracy, 4

j 2

to continna thic and to strengthen occh other in'this.

3 CHAI UJRf RIGLER:

App 3.icantc?

4 MR. REYNOLDS:

Ton, sir.

l 5

CIIAIRI*AN RIGLOR:

Ec you h ve any rosponso?

4 G

MR. R2YNOLDS No.

{'

7 CHICERMMI RIGLER:

Okay.

i O

Ho'.i about a report en your Fridcy nesting and any 9

further thoughts on timing?

10 md 2 gg i

12 i

13 14 15 1G 17 TO 10 20 e

21 j

22 3

25 4

,n.-

,,,,., ~,,... _ -,

$102 S3 1

MR. R2YNCLDS:

i*cs, sir.

We tock a ver; cLrclul lock en Fr.'. day at what we 2

onvision to ha the pcrstatore of the Applicants' cane at 3

t thic particular stagc.

And our estimatcc in that regard are th:,0 wa vould 5

contemplato being in a pociticn to put cn all of tho a

Applicants' fact caces inside of ci:: uschs, and ua vould 7

at the procant anticipate that the a:: pert uitnessac g

of the Appliccnts vould tcko no mera than three washn 9

as we ncw see it.

10 That cbviously depends on the longth of croca-11 examination of those witnasces.

12 In tarns of the time we were talking about for t o, the recess, I would still like to request the four weeks.

34 You indicated you didn' t want a rapnat of all of ths

,_50 argument we went through hafore.

I don' t intend to do that.

I would only cdd that a gcod part of our dicccccion en l

Friday was addressed to the natter of moticns, and w:

do intend to file a number of motions.

I think that wo can do it f airly promptly, but there then has to be an opportunity for tha other cides

,1 2

to reply, and I believe the system with the public interent factor that you discussed on Thursday, Mr. Chairman, of having an expedited hearing cnd not having it drng cut, r

that it would be in the interast of everyhedy for the 23 S

1 0103 hw2 1

Board :o have the opport mity before a dinansion our 1

2 to Jack at thoce metions, a

We are very ccafidant chas theco notien. vill I

4 provida a narrowing of this prec42 ding, i

5 CHidn'FM RIGL2R: tulat ic the natura of the l

3 Itotions?

MR. PEYMOLDS:

Tha mociens are in thO nr.tura i

G of dismincal motions and scna partiel curnaary judy.2nt 9

motions,for thanost part.

to CHNM RER:

SO 70'l 037 fi13 C EUDIC3 ~~

i I won't hold you to thia -- you uny file c :actica for 11 summary disposition with recpect to the entire proceeding?

12 MR. RE'a: OLDS :

That is correct.

I 13 CELUPEN4 RIGLER:

Then you uill file additional

..v>

motions ceeking to obtain sumanry dicposition of lir.itcS 33 oortion or limited icsues?

.-so I

MR. REYMOLDS:

That is correct., addresu&.1 to

,./

issues and also as to allegations uhich hava heen set forth g

that we feel no evidence our insufficant avidones hac gg ccm3 in to sustain the allagaticns.

g CHAIR!W4 RIGLER: IElen do you cnticipata you g

w uld be in a positica to file theaa motiens?

22 MR. PEYNOLCS: We are working on them no.

I hesitate to give you a dato, baccuse as you can appreciate, s,i there are a number of different pecpla in a number of I.

I A'

[

_.. - _. -. - =

G10i bw3 1

different locaticus working cn th mticnc.

e

~

Until I ccn cocrdinata with evaryhedy, it is 3

hard for me to predict.

I have indicttsd "o m r;cno that these have to be fi.'.ed pronpaly cad,an accc sa we can U

gat them filed, ue vill do that.

~

0 Again, when uc talked ue talked in torns of 7

what you had given us, ca a tentativo date on Thuruday.

8 h cnly additici.a1 input that I r.:al'.y havo to 0

what I said before is that I think that the extra ucch to we had asked for would se::te a leglc'imata purpesa in light 11 of the fact we do intend to file the motions,cnd the other 12 side vill need opportunity to racpond. And 'I believc it i

13 would be productive for the 3 card to hava the cppo:nunity 14 to carefully consider the motions before wa ec:r.m.snes wir.h 15 our affirmative case.

16 CHAIRMAN RIGLER:

Did I understand that Uith 17 respect to the fact caso, probchly the firras repraconting f3 individual applicants vill conduct the bulk of the e::aminatienE 19 MR. REYNOLC3:

That is correct.

20 CHAIR!!AN RIGLER:

I.ct ' u take tan minutes, A

21, and T can talk.

22 MR. CHARN0:

Eefore we cdjourn, ~ vould li!:o 23 to reply briefly to Councel's ra:aarka.

2J I think we are going to be faced with a 2S situation when there motions are made Shut the narwre cut l

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I WOuld li.:.c to join i'2 1.

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uhat v2 have o do ic c.e th z.otionn in as sacu

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MR. LESSY:

You aay.ma to.

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9 What if tha :v.otict:s care filed on tha m c '

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.g j restr.ption?

i I

1 01. LESSY:

Stit I c.hinl: tho fairast ucy a fo it

.,, i m

is get the motion.*: in as cocn as possibi.e.

I would 1..ce c.-

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s

I 0107 ar2 i

son that.

2' CHAIB1Gli RIGI22:

All right, wo vill take 10 e

i 3

minutos.

4 (Roccas.)

CHAIRMA:i RIGI.2R:

Mr. Smith cad I have had an

)

e opportunity to confer s d the cotion under Rule 105 of y

the Federal Rules of Evidence to limit tha admiccibility a

of evidence is denied.

g With respect to a hearing data, we t;ould like 10 svary ne I:o come back on the 21st of April, pleacc.

MR. RE'aTOLDS :

Could I aa!. a question en your g

12 first ruling?

MM RIGER:

Ra.

13 MR. PSWOLDS.

Could you give me any indication g

as to uhather it is denied as to a certain date or cerunin 4

tima period so we might hava come f -

as to whether your

^

1,0 denial goes to all of the evidanca th 4t has boon introduced in the cace from 1962 forward, or uh ather there ic a cut-

,3 4

off period?

gg r

n ut-o pe d.

20 IIowever, it in the Board's cbservation that g

littia evidence for dates prior to 1955-66 has coma in,

,,c, t

It has been discussed vary thoroughly when it has como in because we have had arguant on good-cause showing with u,

respect to going behind our Septonbar 1, 1935 discovery date.

2a_

l 1

il

3103 ar3 m

MR. RS*50LD5:

But it 00:33 cn against all 2

App' icants under the 30a.rd's ruling.

O CIL'.I!!I'Jll RIGLOR:

Yas.

4

%!R. GOLD 32nGe

.ir. Chairman, I hav3 t'.:o chhar S

natters.

G Ne ara accuming that tha 10-day rule for the 7

designation of witnessos and the 24 -hour rule for the distribu~

s tion of e::hitits will apply to Applicant's case; is that 9

correct?

10 CHAImi?R RIGLER:

That'c correct.

y MR. GOLD 3 ERG

The cthar c.atter 10 that on 12 September 5,1975, all of the parties c::capt t

13 Applicants were required to file nature of the casa that they p

would be presenting, pleadings.

1

3 This was relief which wac not called for in

.3 the Fules of Evidence, nor required by lav.

It is new for '

17 the first time that all of the cvidence againct Applicant 13 in under the direct case of the Staff, tha Department of

.,~2 ta

g Justica, and the City of Clovoland.

20 We think it is approp2:iato ct this time to requent

~

21 that Applicants fila a nature of the defense to ba prasented by them.

22 CHAIRMAN RIGLER:

Didn't they file a prcha.oring 23 brief?

1 24 MR. GOLDBERG:

Yes.

That was clearly net sufficient

~,

I B

1.

ar4' U109 1

in that as Mr. Reynolds stated On Friday, sad again 2

today, now is tha first tima that applicenta can focus 3

their defence on al.~. ci the evidanc; that ha.c bc3n 4

introduced.

5 This is the purpero for tha breah, as I undcrotand G

it, so they can cecrdinate their defenso and focus it on what 7

the evidence is in the record to date.

8 Therefore, I think it could be appropricho if g

they filed within 10 days fron thia date a nature of tha to defense pleading.

11 CHAIRMAll RIGLER:

Do you agraa to th.t, Mr. Reynolds?

2 MR. RErdOLDS:

No, sir.

4 s

13 CHAIR:f?i RIGLER:

Do you want to coment?

g,;

MR. CHARiO:

Bafore the Appliennt'c commant.

'5 the Dopartment wecid support that unlocs, of cource, the iG Applicants state that they don't wish to raica any new

~

37 l matters of defense that wercn't raiced in their fact briefs i

and their lau brief.

,,o s

gg We would gather from the cross-e:: mination that 20 has occurred that thero era at least ocm3 new arsac, not 21 previously mantioned on briof, and we have no idca of 22 the parameters of thosa areas or hou many areas thera arc.

23 I think it would expedita these proceedings 41 substantially if we could narrow ours to the argur.ont the defendants are actually making, and we are not spread out trying

..,s,

~

1.

3110 ar5 1

to counter things they are not ascerting.

2 C:iAI%imi RIGL2R:

77a m:c of f cn th a r cag foot 3

here with Staff and.7ustica when tra sp:aak of defensa.

4 ilo are talking about a responco.

5 Don't va start out with a pre:naption that S

Applicants for licence have no: viclatad the antitrust latts?

7 Ian't there a procunption of competitiva bahnvicr :1ith 0

respect to license applications?

m 9

MR. CEARNO:

I think it is certainly the posicion 10 of the Departmont and I prasumo the Str.ff that a pri.ma,facio 11 refutatica at the least han haca nado of thats precuIption.

Mc 12 CHAIPlGN RIGLUR:

Than you could x lcs tho i

13 evidence that chows the violation or anticcapatitivo 14 situation, wouldn't you?

3 MR. CIIARNO

Your logic is impeccable.

I can't 13 quibble with it.

But I belicva we are not going to be faced 37 with a case which goes to refutations of cpacific allega-tions.

33 gg I could indeed be very wrong in tht the conprehensive go overall position designed to refute the prina facia, casa is not

g going to be presented by the Applicants.

22 But at this point, I am a bit learl of attempting 23 to meet their direct case without having any indication that I "" "# "9' 24 CHAIRMAN RIGLER:

Isn't thsir direct case going

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8111 ar6 to be an attempt to ncet your cS.argos and your evidenco?

2 MR. CHARHO:

as I was trying to st?.to earlier, I 3

think thera arc a nt?J or of unya of r2cing that.

Certainly 4

they have cet forth cene in their heginning ploadings.

5 Carhain others are im :adiataly suggested by the 3

nature of the case we have put in.

5 7

I believe there are again poccibilities ci 8

others coming to light, and it might e:.pedito the hearing 9

zubstantially if wo didn't hava to ch::a down every specter to en the theory that it constituted cono attack en the case ti that is not i:nmediately relevant in its scope and nctura.

12 MR.GOLDSERG:

Ir Chairman, for any one allogatien 13 which we may have proven, there may be reny, many possible 14 defenses.

Some of the defenses I have heard from Appliccat:

have not even been foundad in lcu.

15

'Je would like to get an indication as to uhich c3?

93 the many defences there may be to an allegation, which of g

those they are going to raly on.

93 MR. EJEIJ1 FELT:

I would like to note that the City 19 joins in the motion.

P0 MR. REYNOLDS:

I was prepared to mak3 a bricf 21 response, Mr. Chairman, but I don't think I can do any 22 better than you can.

23 I think your logic was also icpoccabic.

Our 24 intent is to recpond to ths argurunt cada and to answar ths 1

2,,:

I' l

l

.n

8112 ar7 i

evidence that has been put in, and we have no intuntion of 2

setting up strav ncn in crdsr to knech than d:Un.

3 We will ccnfine ourcalvas ho th0 r.atorisl that is c1 4

record and before thic 30ard,. cad tra intend to raspond to that 5

ovidentiary matter specifically and directly.

6 Wo hava already met and hevo carefully planned 7

the course that we sro going to take, uith in in mind that a

this Board is interested in c::paditing this proccading.

'o put our case on as rapidly and concisoly 9

Wo want c

10 as we possibly can.

11 I don't think at this juncturo to require the 12 Applicants within the three-week period wo are talkinc 13 about, not only to do everything that is already planned to 14 he donc, but also to como in with a statcm:nt of the cort 15 that the Staff suggcots is setsthing that uould he

g productive to this proceeding or would further the cpur

0 o's 37 the hearing in any way.

TS In addition to uhich, I think it 10 probably 19 Physically impossible to do.

23 CHAIRMET RIGLER:

The cugge tion or the notion, 21 however it may be characterized, that Applicants filo a state-mant of the nature of the defensa is daniod.

23 You needn't answer this if you don't want tc, Mr.

24 Reynolds, but do you have an indication now as to uhat the sequence of events is going to be?

25 l

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G was the scheduling ccnflict uith rccptet to ac=0 cf the 1

7 local cct.uical or counsel for tho Applicar t that cra going 8

to conduct th".3 direct case for th3 most part, uha arc o

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10 ir4 early May.

1-Ecccuso cf that, th.:ra ma util b2 c na:d to juggia l'2 our casas cc:mihat to accommodata those cc:mit= sate.

CHAIIUCN RIGLER:

I am.reciate chat.

Thc calv 1.o, 1

t,;

purpoca in asking was for the conveni nce of tha Ucard, cc

.,. rand

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3 MR. P.E*IITOLDS :

That is whv I ucnt to 0.*:cfaca it.'

S t3 1

3 37 The ccquence I give you non may have to ha alterad, i

73 but cnly for that hind of ccatingancy.

Our procent intant 19

- to begin with two fact uitne:nes i;hn '-;ill discuna 13 e.0 :t generally the inductry and how it op.9 rates, the: the 21 t2chnical terms are, and hou the inductry dcsc in fcct i

i 22 function, including c discuccion with regcrd to what 23l the different types of transactions arc, and the cricing I'

machanicas that the specific A.n. licants use ac a facteni y

matter in their daalings with other entities.

.c3 1

[-

t 1

ar9 8114 i

That will then be fcilc* rad by, I hol:.cyo, at the

?-

moment, anyuay, tuo of tha e:: port '<itncasco, and th n we 3

would -- our thinking is nou we uculd begin with the caco of 4

Duquosna Light Company.

i 5

Fcilowing that, we would cova to the Ohio Edinon G

case and that would bz fcllowod by Pennsylvania Pcuer'c 7

caco.

O Then I believe tha ne::t Applicanc would ho 9

Toledo Edison, and then the Cleveland Electric I11uninnting i

to Company, followed by tha re:cining enpart witnecues.

11 I uould only at thic juncture add that the firct 12 two fact witnosses that I mantioned are witnesses which we 13 feel are inportant specifically in responsa to scue cc:stants 14 by the 3oard as to how certain of the tcpacts of the industry 15 work, and uhat,certain of tha transactiona are, and uhat

\\.

1G they nean, and I thl'nk that it ic comething that really -has i

h g

not been fully articulated and uould bc helpful for a full understandin9 of the caco in order to have that educatione.1

--io 79 g process, if you will, at the front and of our cace.

7.0 '

It is for that reason we have schedulad these J

witnesses.

Wo do not anticipate they would take more gg n

than two to tuo and a half dayc for both of them.

I think it is important in response to 'iarious g

questions that have bean mado by the Board about certain y

f g;

specific details and aspects of the industry, both in its l

8115 arlo 1

operation and its pricinc aspectc.

2 clumD;1 nIGL2n:

I ticu?.d anticipata tra uculd 3

run three days starting on the 21ct.

4 Ccd 4 and 5 3

6 7

8 9

10 11 9

72 13 14 13 16 17 13 19 20 21 22 23 24 25

q_..

8116 S5 l

MR. REYMOLDS: Starting th6 21ct.

I i;tuid a

d'l anticipate chay wculd complan thone t ro uitnaccan those S

rirst tn.rac days.

MR. LE2SY:

I Uculd lihn to ccte ' chat the queatixa i

the Board had about inductry oper ticna, to my recol.1.acticn, 6

were primarily directed to c:: pert uitnococo of the stafi',

7 Justice and Cleveland.

I'm starting to got concerned that O

these tto witnesses who are going to go firat,.

I maybo_ chould have filed tactinony in advanca, if they are, 10 in~'. fact, going to discuss things cther then avants.

li

~

MR. CHARNO:

The Ecpart;..snt voeld li.':0 to 12-reserve the opportunit y to ledga cbjections,ac appropriate, i

13 to any attempt to introduce expert tc.3 ti".cny under tha l

I4 guise of fact tactimeny.

I3 CHAIRIOli RIGLER:

That is the remedy.

16 MR. RE7 MOLDS:

Lot es,j"st because I think i:

17 is important if we oro going to thrcch this out,and I'm is getting ready to prepare the cace, mcko it claar i

10 that, to the extent somebody is outsida the in6.ustry and 20 comaa to it, everybody appears to be an e.xpart.

21 What theco people will tastify to ara their 22 day-to-day operations as thoy have c::periences then with 23 their particular companies on a factual basic, in an 24 effort to es: plain such things as one that cor.as to nind 25 as a question raised by the Board, what peaking pcuer ic ac I

L..

g 811*J 1

ococaed to bicoload.

? hat is tho. differenca cs betwo?.n bw2 9

~

an emergency transaction and chart-term transacticn.

It is 3

how you go abcut thin industry c2fecruiting tr:ncacticna, 4

and what the types of transactions are. ;;ha:.;3 maa2 uhen ua 5

say an interconnection,either synchroncus or nonsynchrcacus, 6

iWat it manns when you areuhccling power Stith cn intortic 7

varsus and intercennecticn.

It is that kind of G

dissertation.

It is not intended to be anything more than 9

that. They do come in as fact witncsceo, cnd I uill cay, 10 candidly, thcy were not originally contemplated, but they como II in becauce wo do feel it is essential en the basic of 1 ~

what is going on thus far to hcVe thic hind of intrcductory 13 presentation in the case,in order to giv2 ava-ybcdy a full cuaroness of exactly hcu things do cparato in 15 the industry.

iS g3, ;ggg7,.de reserve tha right to mah appropriate motions at tha appropriate timo.

Il it is 18 information that has beccme available cince the filing I9 of expert testimony, we would cecapt uritten tactincny

• O tan days in advanca.

21 The definiticas cuch as Mr. Ecynolds has no described we are going into in tha direct testimony of 23 Mr. Mozar.

24 MR. REYMCIIS :

The Board had adviscd the

/

25 Applicants, I think, in the course of the seversl diccussion:

l L_

8113 we had with raspect to rod-lining that bacausa cf a change e

in tha accroach to red-linina, if tha App'.ictnts wiched to bw3 2

designate pr9tiens of docuncnts that tray had put in prior to that change, as being red-linad portions, it chould he done by the close cf the othar pcrtics' cceau, and ua have undertakan to go back thror.gh what in no zer than a handful of docur. ants and uould lika to put on tivs record thca2 7

Portions that we didn't red-line that vc neu :rculd lika 0

to have red-lined.

O C9AIP147d! RIGLER:

All right.

10 MR. EEYNOLES:

I don't think it will taka 11 long, but I feel new is the time to do it.

12 XR. 272L3R:

Applicants request that Applicent 13 Exhibit 3-A(DL) be red-linod as folloun:

The cover page.

14 Page 1, the first full pc:tgraph.

Page 3, the coccnd 15 and third full parcgraphs. At pago */ the fif th and cinth IG sentencas of the last parcgraph, beginning "Neverthaleca, 17 the direct cost," and ending "the 40 to 45 cent rangs."

13 And the 1 set sentenco of the Ire:t paragraph, 19 beginning "Thus the total prMuction cost,"

23 On page 10, the first and second full sentancos.

21 On page 12, the cubparagrapha nuriborod 4, 5, 6, 7 22 and en page 15, the subparagraph nurrbered 4.

23 With respect to Applicant 7 (OS-PP), the 24 entire docuraant.

25 With respect to Applicants Erhibit 3(03-PP), the I

t l

8119 bw4 g

entire document. Uith roupact to Applicant Enhibit 9 (CE-P7_

p, the entira doctracnt.

3 With recpact to applicer.tu I;::hibit 1G (CE-3.'), the 4

antira docenant.

g With raspact to Applicanta E::hibit ll(CE-PP),

6 the entire decur.cnt.

j With recpoct to Applicants E:chibit li(CE-UP),

G the entire docu:nent, g

With reapact to Applicenta 1G (DE-P2), paga 1.

10 With respace to 1.pplicanta E::hibit la(CEI) 19, gy 20 and 21, the antiro docu:aent.

93 Uith raspect to Applicants E::hibit 22 (CEI) pages 1, 2, 3, incluci'ic of the cpinica uhich is the.

13 entire opinien.

14 With respect to Applicants E::hibit 23(C3I), the ent:.rc jg

document, t o,.

With respect to Applicanta E::hibit 29 (CE-PP), tha g

entire document.

With respect to Applicants Exhibit 31(CE-PP) gg the entire docu: rant.

,<.0 With respect to Applicanta Er.hibit 34 (OE-PP),

g the entire docu: cent.

With respect to applicants Exhibits 3S(TE),

36, 38, 39, 40, 41, the entira document.

I With respect to Applictnts Enhibit 43 (CSI),

e5

I 1

3120 bwS i

pago 1, which is the cc*rer lottar.

2 Uith respect to.3.pplicanta 2.v.hibfcs

45. 44, 3

47, tb entiro docu:ent, 3

With respect to applicants Unhibit 71(CEI),

3 pages 1 to 2.

3 Uith recpcct to.M2plicants 3xhihit 7a(C22), paga 1.

f a

With reepect to Applicants Enhibit 30 (CSI). pages 1 to 3.

,~,

to Ch respect to Applicanta E=hibit 83 (C5 }, pago

~'

11 That is the end of the cdditiencl rodilining j.,

p d W App u cant.,

13 CIAIRiihN RIGLER:

Off the record, 14 (Discussion of the record.)

13 MR. CIAMIOl The Dopart aant also hn: its rad..

jg lining that it was required to file et the end of chi:

cace, au Rather than read thsn into the record, to have 79 Pr Psad lista of the additional red-linincJ which we would 20 pass out at this time, g

I The Department uould offer the docu: cant bearing g

uc n

n nJ,ac E-dtibit for Idantificatica 23 DJ-606 and would mo.*e that document into evidence ct this time.

,_.c i

l e,

.=

3121 We would,ch the Scard to cencidor the entire 2,[

bw6 dccumant cc Soing red-11and.

i 1

3' 10 RE'iUCLOG :

mc.c tha canninuing ohj acticn.

,)

C3AIMLW P.IGLIR:

Th.24 ic c*mrrnitd, cnd us 1

5 will receiva Departesnt Exhibit 607.

~

s (Tha decmenn referred to ucc Una marhad DJ 2:Cibit 607 4

g for identificetica and uns g

received in evidence.)

g MR. CHJiRMO:

The D p3rtcent would cluo lika y

to request citrification.

It la our ass mptica that the 12 enpert testimony of all of the witneosco, cf all of the 13 enpert witnescas when roccived into the record would ba 1

regarded as red-lined in its entiraty,with the encoptica

.,r>

f those portienn which uero ctruch; is that correct?

I 15 CHAIRMAN RIGL3R That is correct.

1-f,.a MR, CHARMO:

The Departcant would lihe to paco s/

out an attaclucent to DJ-lD0 for identification, uhich to uas requestad by the Clevoland Elsetrics,1 Ill=ihating g

1 i

Company. Wo wara including that attacho. ant at their request.

20 We n. ova DJ-190 into evidence au supplemannsd.

g Initially, Clovalend Electrical Illuminating 22 Cc:npany had requested an antira briaf ba attacheJ which

,,3 was forwarded with the letter which conctitutes DJ-190, In order to clicincto the Xeroning prcblem of i

O,,

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c

--w 1

g

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0122 bw7 1

including the entira brief we have agreed th:t only tha i

9

tppandi

: to that brief nead be su'.:mitted.

3 That !\\ppendi:: wr.3 just distributed to 2.11

'I carties.

I 5

CHMEKJdi RIGL3R:

Hearing no objection, ue will r

G recsive Capartmant E::hibit 100 at this time.

t 7

(The decun:ent pravicual/ marked

}

3 DJ E::hibit 190 for identification ES6 9

was rocaived in evidenca.)

10 i

11 j

12 13 i4 15 16 17 IS i

19 20 t

21 t

I 1

i y

I 2

23 t

I v+m

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---4 w

w+,..

e

3123 37 Gr1 1

MR. REYNOLDS:

I '.:ould liko to make tha centinuing 2

abjection with racpoct to 2:hibit 190 as to all Applicanta 1

3 othar than CEI.

4 CHAIR @.N RIGLER-Ovarrulcd.

5 MR. CIARNO:

At this point the capartment inuld 3

~~.ike to enter into the racerd certain stipulations thct 7

have been reachad.

O CHAIRHTd? RIGLER:

All right.

9 IG. URBA'7 :

As to D.Y 534, 535, and 540, we havo 1

10

.~eceived stipulations that thosa naps vora prepVAA by ' Ohio gg Edicon Cot::pany and that they warc roccived by Toleic I:licon 12 on or about October 1, 1955.

m Y

13 As to DJ 537 -- that they ware physically y

praapred by Ohio Edison.

As to DJ 537, 333, and 539, thoso werc 33 16 physically preparod by Ohio Edicon and woro received by

!.'olado Edison scma timo after October 1, 1965, and we havo 77 been inforced that the Applicants do not knou how nuch after

_so 1965 they were received, and they uay have baan received as 10 early as October 1, 1965.

gg

~

Excusa me, that Tolado Edison dccc not knew.

21 As to DJ 536, this document was physically g

N prepared by Toledo Edison somo timo after 1962.

CHAIRMAN RIGLER:

Off tha record.

g (Diccussion off tha record.)

,...a

ar2 124 i

MR. MELVIU EURGER:

The Dapa.nment would like to mova 2

that DJ 118, which had haOn previcusly withdrawn, ha 3

roc 31*ied in evid nc2.

4 I would like to note for the record tha prchica uith DJ 113.

DJ 118 ic a three-pngs document, the first 3

page of which is a chort noto frca Mr. Leelay Henry to John K.

7 Davia, and the second and third pagsc of uhich are draft a

of a letter dated Deccohor 18, 1967.

9 NRC has introduced tho first page ac Nnc 53, cnd the 10 occond and third pagau ac MRC 54.

The question hac criccn as g3 to whether or not this thrae-pcge docement is in fact one gg document, and wo would ask the Board to find that it in 13 one ocotraant for the following reasons:

14 This throc page documant una produccd an a threc-15 page document to us.

It chould be noted that the date of 33 the first page, the memo on the first page ic December 19, "

1967, and it is a cover mamo.

37 gg It would appear to refer to the recond and third gg pages which is a letter of necember 18, 1967.

g)

Therefore, it is contemporanects with the sacend 33 page.

We would alco noto that in the Pitcairn files g

s pr duced by the Toledo Edison Company, thorc is only one 23 other draft memor:mdum which appears therein and that is g

dated March 1, 1960.

2a,

ar3 1

Thereforo, it would logically appear that the p.

cover namo by Mr. Henry would hava to bc rafarrhig to the 3

craft of December 18, 1967.

4 In addition, the cover m:mo from Mr. Ecury to Mr.

5 Davis refers to a coeting.

It should be noted that DJ 130

.s and DJ 121 each refer tc a mcoting uhich occurred within a 7

veek, week prior to tha proparation of thic memo, and that g

meeting dealt with the question of pitcai.v..'c request for 9

CAPCO edmission.

10 MR. DETROLDS:

Mr. Chairm.in, wo vora achcd to entor into a stipulation, Tolade Edicon vac asked to enter into a stipulation to the offect that those documants woro 12 c.ttached as a single docurent.

13 34 That requect was mada not onco, but I think on two and maybo throa eccasions.

Toledo 2dicon hns no 10 g

problem agreeing the.t the atts.chnent to the I,sc Henry cover memo is in Toledo Edicon's files, but there ic roc. con 37 to believe that the cover meno by Lcc Eenry was not atcached g

to the attachment.

g It certainly doesn't, at Icact on a ravicu of the 0

4 files of Mr. Les Eenry and Mr. John Davin of Tcicdo 2dicon g

Company, there is nothing to indicato that thoso materials g

vers attached.

I have no reason to doubt Mr. Bergcr c reprocenta-8 ut tion that at the time they received the documento, + % v wero 2S

0126 ar4 1

attached.

• would c:: plain to tha Eonrd, and I think Mr.

2 BerrJor can confirm this, thst there wac ccmc ccasidor:.ble 3

confusion with respect to tha Toledo Edicon and Chic Edicon 4

documentc prior to their review by the Dcp2.rtment, after 5

those documents had arrived at the offices of Shew, Pittman, S

to the point where a nu=ter of doct= cats wars collated in-7 correctly and also were cent back when they 7:oro returnad 8

to the wrong company.

9 I don't know, and I'n net going to reprecent to to this Board that this doctr.ent was in c ht category. I can't tj state unequivocally that it wca.

I do know that at the 12 request of the Departcent on savaral occasions a very careful 12 offort was made, an exhunstive effort was made to determine g.

that these two documents were indcod attached er do indeed 15 go togethcr, and we voru unablo to accartain that.

We have no doubt at c11 that both docurr. cats wara.

ao in the files of Telod: Edison Company, but wa do not have g7 any reason to believe v. hey were attached or that the one IS goes with the other.

99 1

For that reason we were unabic to enter into a 20 I

stipulation.

i 21 CHAIRMAN RIGLER:

Did anyone ask bu. Henry 3

directly before he dicd?

g MR. REYNOLDS:

I think that -- I was goina to 24 say something -- I think they hcd and he didn't know.

I'm not g

i

p 8127 ar5 1

that confident of that.

2 fir. Eenry, the last nonth hnforc -- month cr 3

to b2 fore ha died vac away in Florida.

I juc: baunar acu 4

indicate to the 2 card or anggest to the 2 card that that.ac 3

thO ca33.

g I do know that they did undertake to detarmins that theso documents.:Oro indeed companior. doce.cnts.

They 3

were satisfied at Toledo Edison that from tha ravicu of their files there ic.no basis of concluiling that they had g

39 been attached.

MR. LESSY:

As I recollect the record, us rzrked 97 12 S3 and 54 as caparato dece.2nto becauco we had that in all instances.

That is the way wa did it with all documents.

13 i

That is the way the Staff received thsm on g

discovery.

I think at this lets stage, cinca it ic about

..80 three months since that has been received in evidence, 12 to Applicants cannot produce a diffor:nt cttachment to URC 53, g

that the overwhelming presumptien is that 54 is the attach--

73 mant and I think that is apparent from the content.

79 MR. REYNOLDS:

Briefly, to recpond to that, the 40 reason that the NRC exhibits were numbered separately Uas-2,1 becau'se we raised this objection at the tina tho Staff g

sought to introduce them.

j At that time we were ached to make a dotarr.ir.ation 2d and were unable to do co.

I

ar6 3123 CHAIREUI RIGLER:

I taka it frcm your responce that 2

you are not denying that ?IRC 54 is the attachment to ;IRC 53.

3 Yon are saying you cannot stinulato to that ac a fact 4

because you do not hncu it to be the cace.

3 I4R. REWOLDS:

I cm ccying I teill not stipulato S

to it and I object to thom coming in as a single document based en the knculedge of the company and the fnets avnilable 1

r 0

to the company after a thorough scarch of their filee.

g CHAIRIWI RIGL2R:

ThS company nta no direct to kr.ouledge that NRC 54 is not the attach = ant to IIRC 537 g; '

MR. REYNOLDS:

I guess they have ao good knowledget gg a.s you can detemine on the baais of their ravicu of the b-files which shows that the two ware not attached.

I r2on ' t g

really knov what better knowledge you could hcva.

CHAIRMAN RIGLER:

Hou do they : mow they varo 33 rot att0 chad 7

. o-s MR. REWOLDS:

There ic no -- in John Dcvia' 7

i file there is no document similar to 53 which h c attachui 8

i 1

gll to it 54, if ue use those ntnbero, IIRC Staff 53 and 54.

o

.gi en Les Henry's files thara is no docu=ont which i

has 53 and 54 attached to it, and in Toledo 2dicon's files 2,

there is not.

g on the other hand, there is in Toledo Edison's 23

,l files Document S4 and thera is a copy of what is 53 in Toledo m

I a,,

t.

Edison's filen that are not atteched.

i i

t t

I 3129 ar7 1

CHAIR!Ei RIGI23:

Rre they in a filo dealing

?.

gancrally tiith Pitcairn's raquact 2cr.crabarchip in CIWCO?

3

!!R. RI:'IMOLDS :

Certcinly 34 i3.

I'a not atra Uhcthee

.1 53 is or not.

I don't hnc i t;hother Decitzent 53 was in the cama 5

file folder.

I don't believe it tens.

6 CHAIRMAN RIGLER:

It trould alz.oct hr7a to be, or 7

vhy would it have becn decignated for di covery purposuc?

3 MR. REE! OLDS:

The reason I'm haing to careful ic 9

that I'm not about '..o disputo Ie. Lccey or Mr. Berger's 10 reprecentation that when they racoived those documentc, they ucra collated.

72 CHAIPK47 RIGLI:R:

That isn't rf qt:cetion.

13 M. REWOLD3 :

I think there is an c::planation f

g for that, thac is more attainable to the fault of Shaw Pittman.

., S MR. LESSY:

I disputa that dircatly.

I 1:cnt t o.

to Toledo Edison'3 discovery in Toledo befora it was sent il I

t Shaw, Pittman.

My recollection une I mcde a copy of thic la docu=cnt thero because I thought it was that important.

gg

=

Mr. Reynolds' reprasantation that 53 and 54 uaro g

numbered separately at Applicant's raquest in v.cng.

Uc 1

cubmittsd a list of exhibits long before the Anglicar.tc

.a, objected, and we had numbarod them separatcly.

g In terms of chipping to Washington to the Central g

Depository, the chipping itself =cy hava caused a stapled

u..

.a

ar8 S130 1

document to become unctaplod.

But it wan produced to m*j 2

r3 collection in a stapled version.

i 3

MR. ELVIH EERGER:

uculd liho co ach Mr.

l

.?

Roynolds one question, and than note conothing.

3 If S4 was not attachad to 53, uhat uas attached to G

537 l

7 Secondly, it chould ha noted that 54 is a Duqueano s

Light document and not an Ohio Edieon docum?nt.

If ue 9

had an intermingling of Toledo Edison and Ohio Edison I.'.tarial, to it still wouldn't anplain tha finding of a Duquesne document 11 in Toledo Edisen files, in the same filo ac 53.

12 MR. REYUOLDS:

tinct was the first qucstica?

13 E. MELVIN BERGER:

It was what docuzent wac 14 attcched to 53.

Obviously come document use attached to it 1a-when it was sent.

t u,.

MR. REDIOLDS:

I don't have a responca.

Tc1cdo '

Edison is not here.

I don't hava a recponco to thai: ques-

., 7 i

t. ton.

18

g Wait a minuto.

I have the tranceript and

?.

20 r.ay have misspohon.

If co, I don't want to leava a mis-g understanding in anycne's mind.

21 I have checked the reference to tha trcnceriot 2.,.

where Dccuments 53 and 54 uare introduced.

At that tinc.,

g in response to a requect by the Chaimun, I did in fcct

,y w>

indicate that I didn't have any objectica to the fact that a,

i I

1-i 1

ar9 313' i

the two docunants sarc attached, indicating tur.t 53 as I caw l

2 it, was a cover memo no 54.

l t

3 I think I have been adviced by :c-counssl cl j

i 4

Tolodo Edison that I was in error en that Uhich is the s

rencon we have no stipulation or vera unable to entar into G

a atipulation, but.Mr. Lcsay in right, I did, at the tino l

7 he introduced it, repracont that I thcught the two appeared to a

go together.

9 MR. CHARNO:

If the record is clear that 53 and to S4 ware togethar, we will again uithdrau 119.

jj MR. REY:iOLDS:

I'm caying it is clacr fren my 12 axchange with Ma. Lacsy at the ti:c hc incraduced it. that

'(_

33 I'didn't see any reacon they should come in without their 94 being attached.

I have ascertainnd from Toledo Edison 33 g

counsel that they may not havo b1:en attached.

I'm not prepared to entar into a stipulation after intat I havn

.n:

been advised by local counsel, 33 g

I can go no further than that.

I have.no 30 difficulty stipulating that both docr.'nonts came from and are t

e contained in the files of Toledo Edison.

21 To the extent that tora than that is needed, I w,

do have a problem because I micspoke the first time the 3

two docur.:ents came in~.

3.;

I CHAIRMAN RIGLER:

All right.

My.fecling in that y

a

arlo 3132 1

it is not neesssary to move 118 into evidence.

I think 2

the record is clocr new uith respect to the peniticn of tho 3

partica.

l 4

Ma cotid cccc=plich anything with 53 and 34 that 5

tsa could with 110 in and what firding the Eocrd might maho l

3 with respect to the relatienship of the tuo documents we will 7

have to 1sava to the judgment of the Board.

G M. CMEno:

On tha bacia of that rnLing, uc g

will withdrau 118 per=nnently.

j

g The Dcpartcoat la still traiting for a limitsd 1 s, amount of additic ul

22terial frcu the Apolicants., so to

~

12 uill not close our caca at thic tico.

13 Tha Department has nothing furthcr at thic tina.

j

g MR. R3YNOI,DS

As I understand it, thera is a document, Department of Justica Exhibit 40, which uu had

,_w

g poced an objection te, Ohio Edicen had scaed an objecticn t6, und wo are willing to withdraw our objection.

g T o, On Department of Justico Document 98 and 104, the Department asked that the Applicants entar into a

.s i

o~

otipulation to the effect that the copics of thoco docur nts P.0 cre contained in all of the Applicant's filco and wo 21 cra prepared to agree to that stipulation.

g I think that takes cara of everything, docsn't it?

g CHAIRMAN RIGLER:

7.11 right, then va vill admit g

DJ 40.

I i

-l, 4

1 1

l

l 8133 arll 1

MR. CHA3MO:

The Cepartment has a probica tith a

DJ 40.

The objection, cc un underchand it, la thtt the nata 3

sicheduled contained in DJ 40 12 meaningles: uititout a 4

centract.

I don't think that objaction can ha vithdrat;n.

~o 6

We are waiting for a contract, a stipulaticu that 7

thors wac no contract or that the contract was ccmparable f

g or identical with the remaining contracts.

9 We he.m not yet vacaived it.

Ua do not wich 39 to offor DJ 40 until to can como to como understanding with the Applicants with respect to this docu = it.

It g,

has been outstanding for sca:o mnth:,

g We have concved our request a large nunhar of g

timsc,at least five.

1a.

We hava yet to get a roepence en thin particular g

ena. They have been ecoperativa on othar enac, spacifit;.n117' f u,,

Chio Edison's counsel has been cooperative on other ones, t i but we have a oroblem on thic onc.

13 We will not offer DJ 40 uithout a definitivo g

response from Applicants.

CHAIRMAN RIGLIR:

All right.

21 MR. CHAR 120:

Na are uniting for one page of the document from Duquesne Light.

23 and 7 and 3 24 25 w

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o introduca an execrpt frc. the 1971 Trr i frtta DUTacGnc i

Light.

That "Jould b2 the.last enhi. bit.

.,o MR. PSISCn:

This rc juost 17a0 j cot :J;da of r.3 today..

e.?

I'm tott.lly con-lused as to what 10 going cr...

0 2

t CIIAIR!!?;I R. GLI2:

~7cr.'i it cut during th0

,1 5

recsss.

We dcn t trcnt to nit hcra cnd go through i-his 8

7_

procadure.

The record can't ha clencd hacause von herica't 14 reached agrac= ant on DJ-40.

sa Take the c.co.sortunity when

."t u *. cr% cn that

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to work cut the othat-t' o orcblera.

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cleced as to tha other cases, but for tho e fs.i prcble.c and maybc :t, Luis being rccclied for crecc-entcnination;

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MR.

e v>

that the City vill obtain como of tha dectraanta -dtich

~ ~ ~

claimed privilogsd.

a..

MR. F3tiOLDS :

And tha priIilag'ad decnrant

\\,

\\1 i

I

d.3. o,a-bw2 I

suestien,. If it ttume cuc to be rasolv2d diffOreci:ly 2i in the Cetu-t of Impoals.

t 3

CHAIEUJI 15.CC2:

Ua will ::ce r m-icr.2

.t 4

9:30 2.

m., en the 21st.

5 (Wherocpon, c.t 12 :00 p.n., de heari::g.nts l

o G

ndjourned, to be recen.oned at 9:30 a.n., en Wedne.cacy, 7

i April 21, 1976.)

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14

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I 21 23 24 25